The report found 64% of Australians list watching TV as one of their top three preferred entertainment activities, more so than using the internet, listening to music or reading a book.

In fact if anything we are watching more.

According to the report, “Australians are spending more than a day a week watching TV and video content. On average, all survey participants spend almost four hours a day watching all types of video content, on all devices – equivalent to more than 26 hours a week.”

This number is reflective on our binging habits. The report found “When we lock on a hit TV show, we binge – some 72% of survey participants watch back-to-back episodes (three or more) in one sitting – and more than a quarter of us (26%) are doing this once a week.”

So if consumption has nothing to do with the drop in numbers of rental stores – what’s happening?

Yes, renting a physical copy in-store is still (somehow) the preferred way to watch a movie or TV show, with 25% choosing to visit the local video store for their fix, there is an emerging preference of digital formats.

Over the next 12 months, 24% of all of people intend to subscribe to an online streaming service and 21% intend to rent a digital copy.

The promise of a clear stream, unclogged by previews and trailers and the knowledge your viewing won’t be burdened by scratches on a disk, it’s clear to see why DVD stores are struggling.

“By the end of 2014 up to 50 million homes globally will have two or more separate pay TV subscriptions. Most of these 50 million households will have just two pay TV providers, typically one platform-based service, and a Streamed Video On Demand service. In addition about five million homes may have three or more providers.”

Overall the report says, “Our overarching finding is that a number of the much anticipated digital tipping points have arrived.”

According to the findings if Australian’s preference for the Internet as their primary source of entertainment continues to grow at the same rate – 10% year-on-year growth over the past three years – the reports says “it will eclipse watching TV in the coming year.”